Subbarao not keen to continue after present term

February 23, 2012 11:51 IST

Reserve Bank of India Governor Duvvuri Subbarao is not interested in carrying on in his present job after his term ends in September next year.

In an interview to Wall Street Journal, the transcript of which was posted on the central bank's website on Wednesday, Subbarao, who took charge in September 2008 in the midst of a global financial crisis and was initially given a three-year term, said 'no' when asked if he wanted to continue after the present term's expiry. In 2011, the government extended Subbarao's term by two years.

The soft-spoken governor, earlier criticised for a baby-step approach to tame inflation and for continuing with policy-tightening, said "it is legitimate that people criticise".

"Criticism is part of the game when you are making public policy. It's legitimate that people criticise. And I'm comfortable the criticism comes from both sides, which must mean we are at least partly right, that some people think we are right," the governor said in the interview.

Subbarao, however, did not give a straight answer when asked to rate his performance.

"I think it's inappropriate for me to make a mid-career judgment, it's for others to make. I've had enormous

challenges, very difficult situations, but the RBI is a great institution, I've had tremendous intellectual support and advice which I hope has steered the country through challenges," he said.

He was candid, though, in admitting it takes 'great difficultly' to go against the suggestions of the technical advisory committee (TAC) on monetary policy.

"It's difficult. It's certainly something you don't do light-heartedly. You do think twice before going against their advice," he said.

The central bank has recently started publishing the minutes of the TAC meeting, with a lag. RBI meets TAC members, which comprises eminent economists and policy makers, before monetary policy meeting to get their views.

Subbarao also maintained his stand that the debt management office should not be separated from the central bank, as proposed by the government.

He, in fact, said that the conflict of interest argument - that central bank is both a monetary policy authority and government debt manager - was overplayed and if there was one it concerned the issue if government wanted to manage its debt.

"When 70 per cent of the banking sector is with the government, there is a conflict of interest if debt management is done by an office that has some affiliation with the government," he said.